The Louisiana Tax Free Shopping Program for International Visitors: A Case Study

Abstract

The strong relationship between tourism and shopping has long been pointed out, but the tourism literature has largely ignored the issues of duty-free or tax-free shopping, either from an economic or from a marketing perspective. This research note proposes a case study of the only state-sponsored tax-free shopping program in the United States. The analysis puts the Louisiana Tax Free Shopping Program in its historical context, describes the program’s achievements in its 10-year existence, presents Louisiana international tourists’ shopping behavior, then examines the economic impact claims that are made by the program. Results show that tax-free shopping is an incentive that increases tourists’ propensity to buy retail goods. Marketing and policy recommendations are made to conclude this research note.